• Write a paper with at least 2,000 words that analyzes Guillermo’s alternatives. Select and recommend one of the alternatives. Justify your recommendation by discussing the advantages and disadvantages of your solution versus the alternatives.

• Using your recommended solution, create a pro forma cash flow budget for the organization for the next three years: do by month for year one, use annual amounts for years two and three. Assume for the Hi-Tech alternative the new equipment can be leased from the manufacturer for five years at a monthly cost of $23,000 and treated as an operating lease. List ALL assumptions (by line). Set a minimum cash balance amount and assume you can borrow from a line of credit as needed.

• Using the appropriate discount rate compute the NPV of the recommended solution. Explain the rate used and if different from your week 4 WACC result, explain why it is different.

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